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September, a notoriously treacherous month for stocks, began promisingly enough with a 1.4% rally last week. That has encouraged those who see the U.S. stock market poised to climb a proverbial wall of worry. Will it?

Our fall lineup is heavy on drama, what with Middle East skirmishes, uncertain oil prices, and a Beltway fiscal melee that promises to be noisier and more orchestrated than anything on Broadway. But the biggest suspense centers on the future path of U.S. interest rates. Already, the benchmark yield on 10-year Treasuries has jumped in four months from 1.6% to 3% as the Federal Reserve considers scaling back its $85 billion-a-month bond-buying bonanza. So it's a little surprising that the consensus thinks—or hopes—unruly rates will go no higher, for now.

There are, of course, reasons to hope rates will behave in the short term. The fall roster of well-flagged risks could fuel bids for Treasuries. Central bankers also won't want spiking mortgage rates to destabilize the foundation of our housing recovery. Rising U.S. rates have already sucked capital from emerging markets, forcing countries from Brazil to Indonesia to hike rates to defend their currencies even as economic growth founders. Still-benign U.S. inflation, and squabbling politicians who can't seem to energize our economy, leave the Fed to single-handedly prop us up a little longer.

Friday's mediocre jobs report, and downward revisions trimming the recent pace of job creation to just 160,000 a month, eased some of the anxiety over stimulus withdrawal. "The Fed could ease the pain of tapering by lowering the unemployment rate threshold," notes William O'Donnell, co-head of Americas strategy at Royal Bank of Scotland. Or reduce monthly bond buying by just $10 billion "as a nod to weakening conditions in emerging markets and weaker-than-expected third-quarter U.S. growth."

Yet rates had surged this summer long before and far more than any improvement in economic cues. Once the Fed let out the notion of reducing bond-buying, it became harder to stuff that genie back into the bottle. While economic momentum is far from strong, the efficacy of more bond buying, and swelling the Fed's balance sheet indefinitely, also remains debatable. Foreign appetite for U.S. debt has shriveled, and over the past 12 months foreign purchases of Treasuries have declined to $104 billion from $503 billion a year earlier, notes Stephanie Pomboy of MacroMavens. Since the Fed began talking about tapering, foreigners have turned net sellers of Treasuries.

Backing off the pledge to buy bonds indefinitely also marks the first step toward normalizing rates, and we're merely at the start of a long road back. "Treasury positioning has been cut from long to neutral, but is not yet short, limiting the potential for a short-covering rally," notes Binky Chadha, Deutsche Bank's chief strategist, who thinks rate volatility might subside only at higher levels near 3.25%.

Meanwhile, U.S. manufacturing and auto sales are revving up, and the service sector grew to its best level since 2005. Bespoke Investment Group tracks the number of economic reports beating projections over the past 50 days, and that tally has improved from -27 in June to 3 midweek, a sign the economy is starting to surpass recently tempered expectations. No surprise, Wall Street increasingly favors stocks over bonds, even as it continues to expect bond selling to stay mild enough to keep rates tame.

IS THERE A MORE BELOVED food stock on Wall Street than
Hormel FoodsHRL -0.2392753375491369%Hormel Foods Corp.U.S.: NYSEUSD58.37
-0.14-0.2392753375491369%
/Date(1425420286260-0600)/
Volume (Delayed 15m)
:
894933AFTER HOURSUSD57.9418
-0.428199999999997-0.7335960253554908%
Volume (Delayed 15m)
:
21826
P/E Ratio
24.838297872340426Market Cap
15425458966.0617
Dividend Yield
1.7132088401576153% Rev. per Employee
464150More quote details and news »HRLinYour ValueYour ChangeShort position
(HRL)? According to Bespoke, it's the S&P 500 component with the biggest increase in buy ratings in 2013, and the maker of Spam meats and Dinty Moore stews has seen shares rally 46% over the past year, trumping 22% for the packaged-food sector. Hormel missed fiscal third-quarter profit targets, but forgiving investors chose instead to fawn over faster overseas growth. Scoff all you want at salty canned meats with a gelatinous glaze, but Spam is an imported American delicacy in countries from Korea to the Philippines.

Spam has such a following in Hawaii that the so-called "Hawaiian steak" is served in burgers and sushi, but you don't have to be Hawaiian to like Hormel. Falling grain costs will boost meat margins. The tightening supply of turkey means pricier birds this Thanksgiving, and better pricing for Hormel's meat products. The well-run company has lifted earnings at an annual pace near 11%, and a debt-free balance sheet allows it to make acquisitions, like buying Skippy from
UnileverUNA.AE -0.3956604977664327%Unilever N.V. CVANetherlands: AmsterdamEUR39.02
-0.155-0.3956604977664327%
/Date(1425425717000-0600)/
Volume (Delayed 15m)
:
3922865
P/E Ratio
21.86856970005266Market Cap
67174457647.5
Dividend Yield
2.92157867760123% Rev. per Employee
278368More quote details and news »UNA.AEinYour ValueYour ChangeShort position
(UL).